Viper Energy Ut (VNOM)

Fixed asset turnover

		Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019
Revenue (ttm)	US$ in thousands	836,400	920,052	864,131	827,697	826,610	754,987	833,522	866,467	828,629	735,016	609,844	504,917	415,453	350,391	268,910	250,626	267,014	275,860	315,385	298,283
Property, plant and equipment	US$ in thousands	3,760,780	3,611,560	3,741,730	3,768,320	2,776,890	2,810,880	2,837,070	2,750,270	2,810,670	2,829,540	2,860,750	2,920,120	2,337,550	2,357,010	2,380,240	2,405,050	2,537,880	2,565,520	2,587,660	2,547,670
Fixed asset turnover		0.22	0.25	0.23	0.22	0.30	0.27	0.29	0.32	0.29	0.26	0.21	0.17	0.18	0.15	0.11	0.10	0.11	0.11	0.12	0.12

September 30, 2024 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $836,400K ÷ $3,760,780K
= 0.22

Fixed asset turnover is a financial ratio used to evaluate the efficiency of a company in generating sales revenue from its investment in fixed assets. It indicates how well a company is utilizing its fixed assets to generate revenue. A higher fixed asset turnover ratio generally signifies better efficiency in asset utilization.

Analyzing the fixed asset turnover of Viper Energy Ut over the past several quarters, we observe fluctuations in the ratio. The ratio was relatively stable around 0.20 to 0.30 from December 2019 to June 2023. However, since December 2021, there has been a downward trend in the fixed asset turnover ratio, with the ratio declining to 0.10 as of September 2024.

The decreasing trend in the fixed asset turnover may suggest that Viper Energy Ut is becoming less efficient in utilizing its fixed assets to generate revenue. This could be due to various factors such as underutilization of assets, inefficient asset management, or declining sales relative to the investment in fixed assets.

Further investigation into the factors contributing to the decrease in fixed asset turnover is warranted to identify potential areas for improvement in asset utilization and operational efficiency. It is essential for Viper Energy Ut to closely monitor and address the decline in fixed asset turnover to ensure optimal utilization of its assets and enhance overall financial performance.